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RBI Likely to Cut Rate

With retail inflation receding to record low levels, the Reserve Bank of India is likely to cut the benchmark lending rate by at least 0.25% in its third bi-monthly monetary policy review on Wednesday, say experts and bankers, PTI reported. Encouraged by significant price improvement, bankers expect RBI, which has kept rates on hold at 6.25% for the fourth straight time citing risk to inflation, to change its monetary stance and may even go for an aggressive rate cut. “The expectation is of rate cut of a minimum 25 basis points as inflation has eased and also as industrial growth continues to remain weak,” Bank of Maharashtra Managing Director R. P. Marathe said.